All major insurance companies in India offer three primary types of car insurance policies.
Here is a quick list of all types of car insurance available with insurance providers :
- Third Party or Liability Cover
In case you meet with an accident and you are liable for damages to someone else's vehicle, this type of insurance becomes applicable. It is mandatory by law to have a third party insurance cover before you start driving your vehicle on roads. Liability insurance will cover the cost of repairs for any third party property damage caused by you. It also covers the medical bills for the driver of another vehicle, if he/she is injured.
- Collision Cover
When you meet with an accident, you must have a collision cover to bear the expenses. This is the cover that helps to bear all the damage and repair expenses. In case the cost of damages goes beyond the value of the car, you can get the entire sum amounting to the current value of the car from the insurance company, only if you have a collision cover. People with high-end, expensive cars must have a collision cover.
- Comprehensive Cover
This is all-inclusive car insurance, which covers all types of damages to the car. These damages could be in any situation, be it accident, theft, vandalism, or natural disaster. The comprehensive car insurance policy is a complete shield to your car. However, the government has not made it compulsory to buy a comprehensive policy, but it always helps to have one, if it suits your budget and if you are a regular driver. It comes on a higher premium than the other two policies.
- The Add on Covers
Your comprehensive car insurance policy can further be enhanced by adding on the riders like NCB (No Claim Bonus), accessories cover, invoice cover etc.
Stand-alone Car Insurance
What is a Stand-alone Policy?
Stand-alone insurance gives customers opportunities to insure against specific risks that are unique to them.
With influence from 1st September 2019, Own Damage is no longer being combined with Third Party and is being sold as a standalone annual policy. If you purchased your car after 1st September 2018, you now have the choice of obtaining a Standalone Own Damage Car Insurance for the second year. With a 3-year Third-Party Insurance policy now being obligatory for all bike owners in India, the purchase and restoration of Own Damage cover are now individualistic and optional.
To purchase a standalone car insurance plan for own damage you must have a valid third-party liability policy which is legitimate for at least a year.
Is Stand-alone Policy mandatory?
Stand Alone own-damage car insurance is independent and optional.
What is covered in Stand-Alone Policy?
- Theft of your car
- Harm to your car due to natural calamities namely earthquake, landslide, floods etc. and man-made catastrophes such as riots, terrorism, vandalism etc.
- A loss to your car due to an accident
- A loss to your car due to fire or explosion
What is zero dep Stand-alone Policy?
In zero or nil depreciation cover, the policyholder receives the absolute claim on the value of parts such as plastic items, fibre, rubber, a windscreen that are reinstated in the event of loss due to accident.
Difference between Stand Alone and Own Damage
- Third-party cover for three years : Earlier covers granted protection only from claims arising from the third party for three years. While the new policy serves the Supreme Court order at the minimum conceivable cost, your car will be left without any insurance cover in case of unforeseen damage or theft which the Stand-alone policy now encompasses individually.
- Bundled covers (envelopes third party claims for three years and own damage for a year) : In case you want to cover for personal damage without third-party, then you can opt for the Standalone alternative.
- Complete Umbrella cover under Third Party Own Damage (three years cover for both third-party claims and own damage) : One can take this cover if he or she wishes to pay in one single go. However, this is the most costly of all three options. Another downside of this cover is that it does not enable you to shift to another insurer in the next year while Stand-alone enables you to switch.
Here is a quick comparison table to help you understand your need for car insurance :
|
Third-Party Coverage |
Collision Cover |
Comprehensive Policy |
Damage To Third Party's Vehicle |
Yes |
No |
Yes |
Damage to Own Car |
No |
Yes |
Yes |
Low Premium |
Yes |
Yes |
No |
Coverage Other Than Collisions |
No |
No |
Yes |
Personal Accident Cover |
No |
Yes |
Yes |
Coverage of Loss of Belongings in The Car |
No |
No |
Yes |
Medical Expenses For Self |
No |
No |
Yes |
Medical Expenses For Third Party |
Yes |
No |
Yes |
Loss Due To Natural Calamities |
No |
No |
Yes |
Car Theft |
No |
No |
Yes |